Some dealers look past facility programs to sales, profits

Automotive News | February 10, 2013 - 4:30 pm EST

ORLANDO -- What a difference a year makes.

While facility programs continue to cause great concern -- and consternation -- among dealers, the intensity surrounding the issue has subsided since 2012's National Automobile Dealers Association convention.

You could see it at the press conference here today at this year's convention announcing the phase-two results of NADA's facility study. It was pretty typical, with mostly journalists on hand. At last year's press conference, the dealers and dealer advisers in the room easily outnumbered the journalists.

One reason interest in the issue has subsided? It's too little, too late, many dealers suggest to me.

They've already made commitments to the latest rounds of manufacturer image programs and spent their money. The worst of the pain is behind them, and the study -- which reaffirmed that expansive new dealership buildings aren't worth the millions of dollars invested in them -- won't change anything for them.

Improving vehicle sales also are a factor. Dealerships are generating strong profits and their outlook is good. Dealers feel less strapped than they did a year ago.

NADA study author Glenn Mercer acknowledged right up front that facility issues are less painful for dealers today.

But he and NADA officials say the study will still help dealers make tough decisions on investment requests. And, since image programs come in cycles, the nearly two years of work Mercer and NADA put into the study could influence the next wave of image programs.